All posts tagged M&A

The news that Hot Topic is being acquired has the shares up nearly 30% this morning, a sign that not too many people saw this one coming.

But the announcement that private equity firm Sycamore Partners is taking Hot Topic private shouldn’t come as a surprise to B. Riley, which has been calling the alternative teen retailer a potential buyout target for months.

While the firm hasn’t yet issued a note on the acquisition, it’s worth noting that while the deal’s $14 a share price is less than half of the company’s all-time high of $32.30 seen in January 2004, the stock hasn’t closed above $14 since 2006. Of course, the years since 2006 have not been kind to most retailers.

Shares jump 29% to $13.89, just below the offer price, as trading resumes.

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A rout in raw materials has helped drive down holdings in a Carlye Group firm’s flagship fund from about $2 billion to less than $50 million. The collapsing commodities market is spreading pain well beyond specialists to some of the heaviest hitters on Wall Street.